Why Amsterdam is jealous of America's growing weed industry

Smoking marijuana legally in a coffee shop in Amsterdam is a breeze. Producing and acquiring weed legally in the city is another story.

For decades, coffee shops around the Netherlands have permitted customers to buy and consume marijuana legally thanks to a Dutch toleration policy. But it's illegal for coffee shops to purchase their supply of weed. Cannabis production is also forbidden.

"The most difficult thing about having a coffee shop in the Netherlands is that it's allowed to sell it, but it's not allowed to buy it," said Joachim Helms, co-owner of Green House Coffeeshops in Amsterdam and chairman of the Dutch Cannabis Retailers Association.

"The coffeeshop, that whole thing, is organized really well and it really has a lot of benefits, but the back door, that's where the weed is coming in, that's not organized," Helms said.

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A man smokes a cigarette of marijuana.

The Netherlands adopted a toleration policy toward soft drugs like marijuana in the 1970s. Stijn Hoorens, associate director at RAND Europe, said the goal was to separate the markets for soft and hard drugs. Coffee shops provided a legal, safe space for customers to buy and consume marijuana as an alternative to the illicit hard drug market on the streets.

"That policy was actually quite successful over the years in its original goal and that was separating the market," Hoorens said.

Coffee shops in Amsterdam must abide by strict rules to stay in business. For example, they can only sell five grams of cannabis to a customer and cannot be located within 250 meters of a school.

But while marijuana consumption is strictly regulated, authorities have turned a blind eye to how coffee shops acquire their supply. Hoorens said this has led to an illicit market for cannabis in the Netherlands.

"There's an acknowledgement of those harms and those societal effects, not just in the Netherlands but the surrounding countries," he said.

The Dutch government is planning an experiment with legal marijuana production in a handful of municipalities. But it's just a small step in an increasingly growing legal weed market. The global legal marijuana market is expected to reach $146 billion by 2025, according to consulting firm Grand View Research.

Helms said he looks forward to the day when the Netherlands is home to publicly-traded marijuana companies, like those that already in exist in Canada.

"To walk around in those companies and facilities for us is really a dream come true because it's growing weed in a 100 percent legal way," he said.